25th Jun 2007 07:02
Appian Technology PLC25 June 2007 Appian Technology plc / Ticker: ATT / Market: AIM / Sector: Technology 25 June 2007 Appian Technology plc Interim Results Appian Technology plc ('Appian', 'the Company' or 'the Group'), the AIM-tradedprovider of Automatic Number Plate Recognition ('ANPR') systems and trafficmanagement products and solutions, announces its interim results for the sixmonths ended 31 March 2007. Overview: • Significant increase in sales - up 81 per cent. to £3,511,063 (2006: £1,941,253) • Gross Profit up 72 per cent. to £1,702,987 (2006: £991,890) • Increased spending on product development and international sales development which has resulted in a loss per share of 0.29 pence (2006: 0.18 pence) • Three new ANPR camera products developed and brought to market • Strong and growing new business pipeline • Strengthened management team - sales, operations and research & development Chairman's Statement During the period under review, the Group has made significant progress in allaspects of the business as the demand for ANPR products continues to rise,resulting in an increased flow of new business both in the UK andinternationally. We have maintained the focus of the business on our coremarkets and product range, implementing comprehensive sales and marketingstrategies to fully maximise the global sales potential of our ANPR technology.The success of our strategy has been highlighted by the contract wins announcedin the period under review and the subsequent increase in orders. The level ofinterest and enquiries for large scale projects continues to be strong.Additionally, our management teams in the sales, operations and research &development divisions have been strengthened. UK During the first half of the year, the Group won a number of significant UKpolice orders, in many cases displacing competing ANPR providers to become thesupplier of choice. The contract wins in the period include a £270,000 order fora fixed site system from a UK metropolitan police force, orders for our newCOBRA ANPR camera range and a £350,000 order from a West Country constabulary,which is expected to place a further significant order later this year. We alsowon an order from the Civil Nuclear Constabulary, which placed an order formobile systems worth £185,000. In the commercial sector the Group has seen strong growth. A new parking ANPRsystem was installed at the prestigious NEC site in Birmingham and significantfollow on business is expected from this source and for this type ofapplication. Our mobile systems are now being sold to the commercial sector forcommercial applications and this market is expected to grow significantly. TheGroup is selling ANPR technology and cameras to commercial systems integratorsat an increasing rate. International Internationally we have won additional orders in Latin America, the Middle East,Europe and the USA. Notably, the Group has a 30 per cent. interest in aconsortium which has a 10-year contract to run a new congestion charging schemein Malta. This sophisticated system, which is an excellent model for futurecongestion charging schemes, combines ANPR with a state of the art hourlybilling system, allowing motorists to view and pay charges on the internet. Theconsortium intends to roll this initiative out on a worldwide basis. Product Development We remain focused on developing innovative, high specification ANPR relatedproducts, which incorporate unique design features, in order to keep our systemsat the forefront of technology and accuracy. To this end, the Group hasdeveloped three new ANPR cameras specifically suited to the requirements ofreading licence plates. By developing these cameras the Group will enhance itsmarket independence in strategic terms and broaden its product line. TheDirectors believe the market for these new camera products is significant and isexpected to grow substantially in the next year. Our new COBRA camera, which commenced production in February 2007, has been wellreceived in the market, as has the STINGER, a camera designed to recognise andprocess licence plates and associated imagery in extreme conditions and transmitthe data to the user via wireless communications. Our third new camera, theVIPER, a miniature in-car ANPR camera for the mobile market, was launchedearlier in 2007 and the Company has already received a number of orders for thiscamera. Financials For the six months ended 31 March 2007 the Group increased its turnover by 81per cent to £3,511,063 (March 2006: £1,941,253) and gross profit by 72 per centto £1,702,987 (March 2006: £991,890). In line with expectations and as a resultof investment in our team, infrastructure and product development in the firstsix months, the Group incurred a post tax loss of £431,226 (2006: £157,817)after the notional charge under FRS20 of £151,299 (2006: £50,484) which istransferred to reserves. Outlook The need for our technology and expertise continues to grow. Initiatives toimprove the productivity of policing, increasing surveillance requirements, thetrend towards implementation of road user charging, and growing commercialapplications for our product range bode well for our future business prospects.While the timing of the receipt of large orders can impact on reported resultsfrom one accounting period to the next, we have a strong and continuouslygrowing pipeline of new business and believe our increased investment in ourproducts and sales and marketing activities will benefit the Group goingforward. We therefore remain optimistic about the future prospects for theGroup. Patrick RyanChairman APPIAN TECHNOLOGY PLCConsolidated Profit and Loss AccountFor the six months ended 31 March 2007 Restated Restated Unaudited Unaudited Audited 6 months 6 months 12 months ended ended ended 31-Mar-07 31-Mar-06 30-Sep-06 £ £ £ Turnover 3,511,063 1,941,253 5,150,135 Cost of sales (1,808,076) (949,363) (2,453,602) --------- --------- --------- Gross profit 1,702,987 991,890 2,696,533------------------------------ --------- --------- ---------Other operating expenses (2,006,233) (1,160,726) (2,648,739) FRS 20 share charge (151,299) (50,484) (100,967) Amortisation and depreciation (26,338) (12,495) (26,111)------------------------------ --------- --------- --------- 2,183,870 1,233,705 2,775,817 --------- --------- --------- Operating loss (480,883) (231,815) (79,284) Interest 4,859 (12,002) (3,905) --------- --------- --------- Loss before tax (476,024) (243,817) (83,189) Taxation 44,798 86,000 88,654 --------- --------- --------- (Loss)/profit after tax (431,226) (157,817) 5,465 ========= ========= ========= Basic and diluted (loss)/profit pershare (pence) (0.29) (0.18) 0.01 ========= ========= ========= APPIAN TECHNOLOGY PLCConsolidated Balance SheetAs at 31 March 2007 Restated Restated Unaudited Unaudited Audited 31-Mar-07 31-Mar-06 30-Sep-06 £ £ £ Fixed assetsIntangible assets 2,500,083 - 2,247,024Tangible assets 155,486 30,387 60,622Investments 202,850 - - --------- --------- --------- 2,858,419 30,387 2,307,646 Current assetsStock 923,797 512,253 837,953Debtors 2,997,641 1,771,367 2,630,486Cash at bank and in hand 1,212,042 1,253,513 2,768,412 --------- --------- --------- 5,133,480 3,537,133 6,236,851 Creditors - Amounts falling duewithin one year (3,116,237) (2,023,957) (3,270,934) --------- --------- --------- Net current assets 2,017,243 1,513,176 2,965,917 --------- --------- --------- Total assets less currentliabilities 4,875,662 1,543,563 5,273,563 Creditors - Amounts falling dueafter more than one year (634,351) (212,850) (847,816) --------- --------- --------- Net assets 4,241,311 1,330,713 4,425,747 ========= ========= ========= Capital and reservesCalled up share capital 1,526,550 1,164,275 1,506,550Share premium account 10,365,838 8,374,785 10,290,347Merger reserve 623,432 - 623,432FRS 20 reserve 302,573 100,791 151,274Profit and loss account (8,577,082) (8,309,138) (8,145,856) --------- --------- --------- Shareholders' funds 4,241,311 1,330,713 4,425,747 ========= ========= ========= APPIAN TECHNOLOGY PLCConsolidated Cash Flow StatementFor the six months ended 31 March 2007 Restated Restated Unaudited Unaudited Audited 6 months 6 months 12 months ended ended ended 31-Mar-07 31-Mar-06 30-Sep-06 Note £ £ £ Net cash outflow from operatingactivities 3 (822,232) (583,818) (1,369,382) Return on investments and servicingof finance 4,859 (12,002) (3,905) Taxation 44,798 - 88,654 Capital expenditure and financialinvestments (577,111) (276) (152,457) Acquisitions and disposals - - (622,215) Financing 236,775 1,919,736 4,078,104 --------- --------- ---------(Decrease)/increase in cash in theperiod 4 (1,112,911) 1,323,640 2,018,799 ========= ========= ========= APPIAN TECHNOLOGY PLCNOTES TO THE INTERIM RESULTSFor the six months ended 31 March 2007 1 BASIS OF PREPARATION The interim financial information has been prepared in accordance withapplicable accounting standards generally accepted in the United Kingdom, underUK GAAP and under the historical cost convention. The principal accounting policies of the Group are set out in the Group's 2006annual report and financial statements and the policies have remained unchangedexcept for the adoption of FRS 20 'Share based payments'. The Group issues share options to incentivise and retain its employees. Inaccordance with FRS 20, the payments are measured at fair value at date ofgrant, using the Monte Carlo Simulation model for the original Share OptionScheme and some of the warrants and a binomial model for the EnterpriseManagement Incentive Scheme. The fair value is then expensed on a straight linebasis over the vesting period, based on the Group's estimate of the number ofshares that will eventually vest, updated at each Balance Sheet date. The interim financial information has been reviewed by the Group's auditors. Acopy of the auditor's review report is attached to this interim report. 2 (LOSS)/PROFIT PER ORDINARY SHARE The calculation of the basic (loss)/profit per share is based on the (loss)/profit attributable to ordinary shareholders divided by the weighted averagenumber of shares in issue during the year. (Loss)/profit per share has beencalculated on the "net basis". The loss per share in 2006 increased from 0.12pto 0.18p due to the inclusion of FRS20 "share based payments" charge of £50,484. Unaudited Unaudited Audited 6 months 6 months 12 months ended ended ended 31-Mar-07 31-Mar-06 30-Sep-06 (Loss)/profit after taxation (£) (431,226) (157,817) 5,465FRS 20 share charge (£) 151,299 50,484 100,967(Loss)/profit after taxation beforeFRS20 charge (£) (279,927) (107,333) 106,432Ordinary shares in issue during theperiod 146,600,050 87,651,120 105,978,955 (Loss)/profit per ordinary 1 p share(pence) (0.29) (0.18) 0.01(Loss)/profit per ordinary 1 p sharebefore FRS20 share charge (pence) (0.19) (0.12) 0.10 ========== ========= ========= 3 net cash outflow from operating activities Restated Restated Unaudited Unaudited Audited 6 months 6 months 12 months ended ended ended 31-Mar-07 31-Mar-06 30-Sep-06 £ £ £ Operating loss (480,883) (231,815) (79,284)Depreciation 16,600 12,495 20,537Amortisation of goodwill and intangibles 9,738 - 5,574FRS 20 share charge 151,299 50,484 100,967Increase in stock (85,844) (34,416) (59,793)Increase in debtors (367,155) (481,419) (1,116,952)(Decrease)/increase in creditors (65,987) 100,853 (240,431) --------- --------- ---------Net cash outflow from operatingactivities (822,232) (583,818) (1,369,382) ========= ========= ========= 4 reconciliation of net cash flow to movement in net FUNDS Unaudited Unaudited Audited 6 months 6 months 12 months ended ended ended 31-Mar-07 31-Mar-06 30-Sep-06 £ £ £ Change in net funds resulting from cashflows (1,112,911) 1,323,640 2,018,799Movement on finance leases (141,285) (7,166) 28,182 --------- --------- --------- Movement in net funds in the period (1,254,196) 1,316,474 2,046,981Opening net funds/(debt) 1,659,880 (387,101) (387,101) --------- --------- --------- Closing net funds 405,684 929,373 1,659,880 ========= ========= ========= 5 share capital During January 2007 2,000,000 warrants were exercised at a price of £0.05 perordinary share, yielding £100,000. The difference between the total consideration and the nominal value of theshares issued has been credited to the share premium account. 6 PUBLICATION OF NON-STATUTORY ACCOUNTS The financial information set out in this interim report does not constitutestatutory accounts as defined in section 240 of the Companies Act 1985. Thefigures for the year ended 30 September 2006 have been extracted from thestatutory financial statements which have been filed with the Registrar ofCompanies. The auditor's report on those financial statements was unqualifiedand did not contain a statement under Section 237(2) of the Companies Act 1985. INDEPENDENT REVIEW report to Appian Technology Plc Introduction We have been instructed by the Group to review the financial information for thesix months ended 31 March 2007 which comprises the consolidated profit and lossaccount, consolidated balance sheet, consolidated cash flow statement and notes1 to 6. We have read the other information contained in the interim report whichcomprises only the financial overview and Chairman's statement and consideredwhether it contains any apparent misstatements or material inconsistencies withthe financial information. Our responsibilities do not extend to any otherinformation. This report is made solely to the company in accordance with guidance containedin APB Bulletin 1999/4 "Review of Interim Financial Information". Our reviewwork has been undertaken so that we might state to the company those matters weare required to state to it in a review report and for no other purpose. To thefullest extent permitted by law, we do not accept or assume responsibility toanyone other than the company for our review work, for this report, or for theconclusion we have formed. Directors' responsibilities The interim report, including the financial information contained therein, isthe responsibility of and has been approved by the directors. They areresponsible for preparing the interim report and ensuring that the accountingpolicies and presentation applied to the interim figures are consistent withthose applied in preparing annual accounts except where any changes, and thereasons for them, are disclosed. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4"Review of Interim Financial Information" issued by the Auditing Practices Boardfor use in the United Kingdom. A review consists principally of making enquiriesof management and applying analytical procedures to the financial informationand underlying financial data and, based thereon, assessing whether theaccounting policies and presentation have been consistently applied unlessotherwise disclosed. A review excludes audit procedures such as tests ofcontrols and verification of assets, liabilities and transactions. It issubstantially less in scope than an audit performed in accordance withInternational Standards of Auditing (UK and Ireland) and therefore provides alower level of assurance than an audit. Accordingly, we do not express an auditopinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications thatshould be made to the financial information as presented for the six monthsended 31 March 2007. GRANT THORNTON UK LLPCHARTERED ACCOUNTANTSOxford22 June 2007 * * ENDS * * For further information please visit www.appian-tech.com or contact: Pat Ryan Appian Technology plc Tel: 01628 554750Tom Keene Appian Technology plc Tel: 01628 554750Hugo de Salis St Brides Media and Finance Ltd Tel: 020 7242 4477Simon Clements John East & Partners Limited Tel: 020 7628 2200David Worlidge John East & Partners Limited Tel: 020 7628 2200 Notes to Editors Appian Technology Plc is a leading provider of Automated Number PlateRecognition (ANPR) based enforcement, crime reduction, counter terrorism (CT)and traffic management systems and products. It provides these products to adiverse growing global market, helping governments, local authorities, nationaland international police forces and commercial organisations in all aspects ofsecurity, surveillance and traffic management. Appian's key products include its world leading Talon ANPR software as well asthe recently launched range of Cobra ANPR cameras. The Company has an active R&Ddepartment, which continues to develop and customise new products for the globalmarkets. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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